Tiger Airways PH sees 50% sales jump

MANILA, Philippines—Tiger Airways Philippines, the local unit of Singaporean budget airline Tiger Airways Holdings, expects revenues to increase by half in the next fiscal year to P7.5 billion due to robust demand, its top official said.

Tiger Philippines CEO Olive Ramos told reporters that the forecast took into account the first phase of a recently announced fleet expansion plan. She added that the airline was on track to hitting its P5-billion revenue target for the current fiscal year, which will end in March 2014.

“We expect around 50-percent growth in revenues especially if the new aircraft will come in,” Ramos said. She said profits were still mixed so far this year, although an improving revenue base would help earnings in the coming years.

Tiger Philippines, which operates five aircraft comprised of medium-range Airbus A320s and A319s, was planning to lease as many as three A320s by next year, she said. This is part of a plan to boost its fleet to 25 planes in three to five years.

The expansion will allow Tiger Philippines to cover potential new international routes.

Tiger Philippines, for example, is banking on getting seat entitlements to Japan should air talks with the North Asian country prove successful this week.

She said the airline was looking at getting 8,000 seat entitlements to and from Japan, Ramos said. She said the airline was looking to fly daily to Tokyo, Fukuoka, Okinawa and Osaka.

Another attractive market is South Korea but flights here would only be possible once the US Federal Aviation Administration grant the Philippines a “Category 1” status from the current Category 2. The country was downgraded five years ago.

The Civil Aviation Authority of the Philippines said FAA inspectors arrived in the country two weeks ago, part of a regular assessment that would be conducted over the next two years.

But given the progress the Philippines has made in air safety reforms, CAAP said an upgrade was likely within the year and possibly as early as October.

Tiger Philippines has sought to differentiate itself from the competition by offering more leg room and giving options, for a fee, for passengers seeking more than the typical “no-frills” services associated with the budget airline business model.

Its expansion plans, meanwhile, would remain firmly rooted in the region, Ramos said. Tiger Philippines recently launched flights from Kalibo, near the tourist hotspot Boracay island, to Singapore as well as Manila to Phuket, Thailand.